Interesting reading, but no great logic and analysis in my opinion.
Read Ursula K. Le Guin's piece again: it doesn't preach against fantasy settings or outlandish plots. It warns against getting caught into a sterile spiral forever.
There's nothing wrong with a kid eating a piece of delicious candy every now and then. But a strict diet of candy won't give him/her the correct nutrition elements needed to healthily grow up. Ursula K. Le Guin is telling exactly that: that we also need nurturing, and not just comforting food for our minds.
Then there's the faulty examples of Pan's labyrinth or Brazil, which are not as much escapist works per se as works about escapism. The difference is substantial and is again evident when further examples remark the need for a meta-analysis of escapism.
Saying that Star Trek teaches us about cold-war era mentality and fears does not validate the idea that there's value in its escapist content. On the contrary, it seems to mean that a contextualized analysis is what is needed to add that value. In other words, a value that, say, a 13 years old kid today from a different country than USA is going to miss unless you point out the references to the racial issues, cold war, etc.
That's of course nothing special: most art,especially modern art, gains most of its perceived value by contextualizing it.
A better example would have been with classic fairy tales and fables. Bruno Bettelheim among others wrote great analysis of the classic fables and their roles in the education and psychological growth of children. That's an escapism that brings hidden contents rooted in reality, the only context required being the receiver having a basic child human psychology, having to cope with fear of abandonment, oedipal complex and so on.
That's an escapism that Ursula K. Le Guin would not bash as it promotes growth and inner discovery in the kid. In some senses it's not escapism at all because it's a harsh reality under different clothes, a much needed bitter medicine frosted with sugar.
In short, I think the author failed to make his point about the value of escapism per se, actually validated the idea that the better value of escapist works comes from piercing the barrier between the worlds, when escapism is just a tool or device for pushing contents that are not distanced from reality at all.
